Market Momentum Shifts as Spotify Stock Approaches Buy Point
The streaming music giant Spotify Technology (SPOT) is making waves on Wall Street, with three top analysts raising their price targets on the stock. This sudden surge in confidence comes as Spotify stock inches closer to a buy point, signaling a potential upswing in the market.
Analysts Weigh In
Deutsche Bank analyst Benjamin Black is bullish on Spotify, citing its durable top-line growth and improving margins. He believes the company’s subscription price increases and potential new superpremium service will drive growth. Black raised his price target on Spotify stock to 535 from 500.
UBS analyst Batya Levi is also optimistic, raising her price target to 540 from 485. She points to Spotify’s solid financial progress last year, including strong revenue growth and a pivot to profitability. Levi expects the company’s momentum to continue, driven by subscription adds and product enhancements.
Gross Margins Expected to Expand
Levi notes that gross margins will continue to expand, albeit at a slower pace, as Spotify invests in its partner program. She also sees several potential catalysts ahead, including the launch of premium/superfan tiers, additional price increases, and improved advertising trends.
Spotify Stock on the Rise
Spotify stock advanced 5.9% to close at 490.69 on Wednesday, forming a flat base with a buy point of 506.47. This buy point is also the stock’s all-time high, reached on December 4. Spotify stock is featured on the IBD Tech Leaders list, as well as IBD’s Leaderboard and SwingTrader lists.
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